Resource conservation and economic efficiency of Russian agricultural production

Why production costs are rising: specifics of agricultural resources

Every ton of output produced requires a strictly defined volume of land, materials, energy, and labor. Reducing these costs per unit of production is the foundation of resource conservation, which directly determines the cost price and competitiveness of a farm. For an agronomist, this means systematic work with four indicators: land intensity, material intensity, energy intensity, and labor intensity. The lower these parameters are, the higher the economic efficiency of production.

The efficiency of resource use in agriculture depends on the performance of all segments of the agro-industrial complex and has its own specific features. The main resource here is land, which requires specific operating conditions and means to restore soil fertility. Production is highly dependent on the season and climatic zones, and a significant part of the fleet consists of mobile machinery that requires large volumes of fuel and lubricants. In addition, the agronomist deals with living organisms—plants and livestock animals—the cultivation of which is always associated with biological risks and requires significant expenditure.

For example, to provide plants with nutrients and maintain soil fertility, it is essential to use mineral fertilizers. However, in recent years, their application to crops has been decreasing in terms of active ingredient. And this is occurring against the backdrop of a general increase in fertilizer production in the country.

The situation is complicated by the fact that the economic potential of Russian agriculture is 2–2.8 times lower than that of the main global producers—the USA, Canada, and European countries. At the same time, domestic production is characterized by extremely high fuel intensity. In addition to objective reasons, the failure to follow technological requirements directly at enterprises leads to the waste of resources and an increase in production costs.

How to reduce costs: laws of resource conservation

To reduce the resource intensity of production on a farm, it is necessary to establish standards for individual types of costs, including land intensity. Real cost reduction is achieved through control at every technological stage. It is important not just to save raw materials, but to implement solutions that eliminate the very possibility of direct losses.

The main practical areas of resource conservation at enterprises are:

• economical consumption of all resources, including electricity, according to established standards;
• prevention of direct resource losses at all technological stages;
• use of progressive resource-saving technologies in crop production and livestock farming;
• strengthening of material incentives for employees for resource conservation;
• monitoring of resource use and the introduction of payments.

When managing costs, it is necessary to rely on the fundamental laws of resource use. Ignoring these rules leads to technological errors and a decrease in profitability. Understanding these mechanisms helps in purposefully reducing production costs.

In economic practice, it is important to consider the following laws:

• Law of the minimum: the development level of any process is determined by the resource that is in the minimum.
• Law of the optimum: maximum efficiency is achieved only at the optimal value and ratio of resources.
• Law of substitution: certain groups of resources can compensate for each other if they have an equivalent effect.
• Law of diminishing returns: with an increase in one resource and the constancy of the others, a limit is reached beyond which the return from it begins to fall.

Technological innovations help to significantly increase the economic potential of a farm. Any new scientific and technical solution—from a new cultivar or breed to an improved production method—must reduce costs or create conditions for savings. In market conditions, innovations become a commodity, so they must not only possess novelty but also meet real market demand.

Many innovations are classified by different criteria in order to organize innovative activity for the development of the enterprise's production potential depending on the type of innovation. Innovations in an enterprise are:

• managerial — the use of information technologies and software packages to solve management tasks;
• production — the use of automatic machines, robots, and computers in production, organization of waste-free production;
• technological.

An innovation result can have a material form (a new cultivar, preparation, device, etc.) and a non-material form, for example, know-how as a product of intellectual labor.

The development of science and technology manifests itself in the continuous impact of scientific discoveries and inventions on the level of machinery and technology. The use of the achievements of scientific and technological progress requires large expenditures from an enterprise.

Under the influence of scientific and technological progress and innovation, the following changes occur in production:

• use of new machinery and improved technological processes;
• implementation of developments for obtaining products with new properties;
• improvement of working conditions and content, motivation and remuneration, and creating conditions for the development of employee capabilities;
• increase in output per unit of labor cost;
• obtaining environmentally friendly products.

The main reasons hindering innovation activity at enterprises are the limitation or lack of funds, the lack of economic incentives for the enterprise and material incentives for direct workers, and weak organization of innovation activities at various levels.

This is defined as the "insusceptibility" of agriculture to innovation.

Taking into account the needs and specifics of agriculture, the following key directions of scientific and technical progress at industry enterprises are identified:

• valuation of land, creation of information systems, reproduction of soil fertility, and improvement of farming culture;
• creation of effective seed production systems;
• use of advances in genetics and breeding;
• creation of technologies for producing high-protein feed, and ecological and waste-free production.

The implementation of these directions will allow for increasing the efficiency of all components of production potential.

Currently, innovations in waste-free production are especially important. Progressive technologies make it possible to reduce waste, prevent its occurrence, and, finally, fully utilize it for the purpose of obtaining useful products. Scientific and technical progress ensures progressive technologies for the storage of products and resources, and offers updated or fundamentally new options for machinery and technology for using alternative types of energy that are safe for the environment.

What is the material basis of production? 2. What is production potential? 3. What is the significance of leasing in agriculture? 4. What is trade credit? 5. What is the advantage of using agricultural machinery on a cooperative basis? 6. How is the aggregate of resources classified? 7. Which resources are called interchangeable and complementary? 8. Why is there a reduction in resource consumption by modern Russian agricultural enterprises? 9. How are Russian agricultural enterprises equipped with tractors and combines? 10. How are energy intensity and energy capacity calculated? 11. How is the effectiveness of the electrification process in the industry manifested? 12. How is the level of mechanization in the industry determined? 13. What are the basic requirements for agricultural mechanization equipment? 14. What indicators characterize the efficiency of using the machine and tractor fleet? 15. What is the main indicator expressing the efficiency of using vehicles? 16. How is the structure of agricultural land calculated? 17. How does land differ from other agricultural resources? 18. Define differential land rent. 19. What does the concept of "economic soil fertility" mean? 20. What is meant by absolute and relative soil fertility? 21. What indicators characterize the efficiency of land use? 22. What is agricultural intensification? 23. How are economic requirements taken into account when assessing land use? 24. For what purposes is the State Land Cadastre necessary? 25. How is the soil quality score determined? 26. What does resource conservation consist of? 27. What features of material and technical resources in the industry should be considered for their better use? 28. In which main directions is resource conservation carried out in agriculture? 29. What is meant by innovations and innovation activity? 30. What is the essence of waste-free production?